Docusign, Inc. · NASDAQ:DOCU
Docusign — Investor Day (March 2021)
78 slides from Docusign's investor day presentation, Mar 24, 2021
Slide 1: Analyst Day
DocuSign Analyst Day March 24, 2021
Slide 2: Welcome
Welcome Annie Leschin VP of Investor Relations 1 2 3 4 5 6 7 8
Slide 3: Safe harbor
Safe harbor This presentation contains forward-looking statements that are based on our management’s beliefs and assumptions and on information currently available to management. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “m
Slide 4: Non-GAAP financial measures and other key metrics
Non-GAAP financial measures and other key metrics To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we use certain non-GAAP financial measures, as described below, to understand and evaluate our core operating performance. These non-GAAP f
Slide 5: Agenda
Agenda Welcome Annie Leschin, VP of Investor Relations Capitalizing on the Anywhere Economy A conversation with Dan Springer, CEO & Cynthia Gaylor, CFO The Next Must-Have Cloud Platform Scott Olrich, Chief Operating Officer Customer Interview Scott Olrich, Chief Operating Officer Agreement Cloud Inn
Slide 6: Logistics
Logistics Schedule 5 presentations and a 15 minute break Q&A To be held at the end Analysts may submit questions to Annie Leschin References & replay investor.docusign.com
Slide 7: Capitalizing on the Anywhere Economy
Capitalizing on the Anywhere Economy Dan Springer, CEO Cynthia Gaylor, CFO 1 2 3 4 5 6 7 8
Slide 8: The Next Must-Have Cloud Platform
The Next Must-Have Cloud Platform Scott Olrich Chief Operating Officer 1 2 3 4 5 6 7 8
Slide 9: The Agreement Cloud Company
G The Agreement Cloud Company
Slide 10: The Next Must-Have Cloud Platform
The Next Must-Have Cloud Platform Front office Back office Marketing Sales Service HR ERP IT/Ops Clouds Clouds Clouds Clouds Clouds Clouds Business Processes Agreement Processes Agreement Cloud
Slide 11: Agreement Cloud
Agreement Cloud a a a al Prepare Sign Act Manage Gen & Negotiate eSignature “* CLM“ Insight “°* Analyzer "" Identify Payments Monitor Guided Forms Notary“
Slide 12: Offer best way to agree to anything, anywhere
Offer best way to agree to anything, anywhere Identify Click Notary LEADER LEADER NEW World’s #1 way to send Enhanced signer No-signature-required Electronic and remote and sign electronically identification “clickwraps” notarization Most capabilities + larger Range of enhanced ID options, Snaps int
Slide 13: Ability to automate the end-to-end agreement process
Ability to automate the end-to-end agreement process Insight Analyzer Gen LEADER LEADER NEW LEADER Contract Lifecycle AI-based agreement AI contract review and Automated document Management analytics and search risk analysis generation Based on SpringCM Based on Seal Software Classifies and analyzes
Slide 14: Platform of record for agreements
Platform of record for agreements Object model API Monitor LEADER PIONEER LEADER NEW Centralized storage Structured, live Rich application Agreement activity and search definition of Agreements program interface tracking DocuSign stores more Enable agreements to be Developer-first, handling Detect t
Slide 15: Agreement Cloud
Agreement Cloud a a a al Prepare Sign Act Manage Gen & Negotiate eSignature “* CLM“ Insight “°* Analyzer "" Identify Payments Monitor Guided Forms Notary“
Slide 16: We are in the early days of the Agreement Cloud Opportunity
~$50B+1 eSignature We are in the - Click ~$26 early days of the Agreement Broader Sign Offerings Cloud Opportunity - Notary - Identify ~$4 TAM for Agreement Cloud1 Broader Agreement Cloud Offerings - CLM - Insight - Document Generation ~$17 Platform ~$3 (1) Provided by Top Global Strategy Firm in 20
Slide 17: Customer Panel
Customer <~. P a Nn e se< snowflake’ AR
Slide 18: Agreement Cloud Innovation
Agreement Cloud Innovation Tom Casey SVP, Engineering 1 2 3 4 5 6 7 8
Slide 19: Agreement Cloud
Agreement Cloud Prepare Sign Act Manage Gen & Negotiate eSignature LEADER CLM LEADER Insight LEADER Analyzer NEW Identify Payments Monitor Guided Forms Notary NEW Integrations Industry Solutions Salesforce | Microsoft | Google | SAP | Workday | Hundreds more Financial Services | Life Sciences | Gove
Slide 20: Modular Capabilities
Modular Scalable + AI Capabilities Reliable Infused Most applications Most integrations Award-winning API More than a dozen >350 pre-built integrations 1000+ Customer applications span the with common systems Integrations agreement lifecycle where work gets done
Slide 21: Scalable + Reliable
Modular Scalable + AI Capabilities Reliable Infused Millions of new 99.99%+ Billions of agreements per day availability agreements stored Scalability to support Customers can trust DocuSign acts as a global business today mission-critical workflows system of record for and into the future to operate
Slide 22: AI Infused
Modular Scalable + AI Capabilities Reliable Infused Reduce risk Automate tasks Deliver insights Accelerate contract Expedite envelope Find, filter, and analyze review by highlighting preparation with automatic agreements with risk and make field type detection and tag purpose-built contract correcti
Slide 23: The Agreement Cloud is for all businesses
The Agreement Cloud is for all businesses from the true small business to the largest enterprise
Slide 24: Agreement Cloud for SMB
Agreement Cloud for SMB Order Fulfillment & Bill / Opportunity Quote & Contract Renew / Amend Service Delivery Payment Prepare Sign Act Manage
Slide 25: Agreement Cloud for SMB
Agreement Cloud for SMB Order Fulfillment & Bill / Opportunity Quote & Contract Renew / Amend Service Delivery Payment Prepare Sign Act Manage Gen | eSignature | Agreement Actions | Writeback to Salesforce
Slide 26: Agreement Cloud for Enterprise
Agreement Cloud for Enterprise Contract Assess risk & Approval & Updates & Contract RFx Process Vendor Selection Internal Review Closing Vendor Negotiation Negotiation Contract Execution Vendor Management Remediation Review opportunities Execution Renewals Prepare Sign Act Manage
Slide 27: Agreement Cloud for Enterprise
Agreement Cloud for Enterprise Contract Assess risk & Approval & Updates & Contract RFx Process Vendor Selection Internal Review Closing Vendor Negotiation Negotiation Contract Execution Vendor Management Remediation Review opportunities Execution Renewals Prepare Sign Act Manage Analyzer | eSignatu
Slide 28: Agreement Cloud
Agreement Cloud Prepare Sign Act Manage Gen & Negotiate eSignature LEADER CLM LEADER Insight LEADER Analyzer NEW Identify Payments Monitor Guided Forms Notary NEW Platform Infrastructure | Administration | Authentication | Service Protection | Object Model | Repository | Search | Machine Learning |
Slide 29: Agreement Cloud
Agreement Cloud Prepare Sign Act Manage Gen & Negotiate eSignature LEADER CLM LEADER Insight LEADER Analyzer NEW Identify Payments Monitor Guided Forms Notary NEW Integrations Industry Solutions Salesforce | Microsoft | Google | SAP | Workday | Hundreds more Financial Services | Life Sciences | Gove
Slide 30: Agreement Cloud
Agreement Cloud Prepare Sign Act Manage Gen & Negotiate eSignature LEADER CLM LEADER Insight LEADER Analyzer NEW Identify Payments Monitor Guided Forms Notary NEW Integrations Industry Solutions Salesforce | Microsoft | Google | SAP | Workday | Hundreds more Financial Services | Life Sciences | Gove
Slide 31: Agreement Cloud
Agreement Cloud Prepare Sign Act Manage Gen & Negotiate eSignature LEADER CLM LEADER Insight LEADER Analyzer NEW Identify Payments Monitor Guided Forms Notary NEW Integrations Industry Solutions Salesforce | Microsoft | Google | SAP | Workday | Hundreds more Financial Services | Life Sciences | Gove
Slide 32: Agreement Cloud
Agreement Cloud Prepare Sign Act Manage Gen & Negotiate eSignature LEADER CLM LEADER Insight LEADER Analyzer NEW Identify Payments Monitor Guided Forms Notary NEW Integrations Industry Solutions Salesforce | Microsoft | Google | SAP | Workday | Hundreds more Financial Services | Life Sciences | Gove
Slide 33: Multi-Channel GTM
Multi-Channel GTM Loren Alhadeff Chief Revenue Officer 1 2 3 4 5 6 7 8
Slide 34: Anywhere GTM
Anyone, Anywhere GTM Direct Digital Partner Land | Expand | Extend Lead | Try | Buy | Upgrade Reseller | Software Vendor | Systems Integrator Hundreds of Millions Signers
Slide 35: Nearly a Billion Signers
Nearly a Billion Signers
Slide 36: Paying Digital Customers
767,000 BUY NOW Paying Digital Customers
Slide 37: Direct
Direct Land | Expand | Extend Digital Lead | Try | Buy | Upgrade Partner Reseller | Software Vendor | Systems Integrator Hundreds of Millions Signers
Slide 38: Expanding Across Regions
Expanding Across Regions North America EMEA LATAM APJ
Slide 39: Winning Strategy for Customers of All Sizes
Winning Strategy for Customers of All Sizes Enterprise Commercial SMB
Slide 40: Large & Growing Customer Base
Large & New Customer Acquisition Growing Customer Existing Base Customer Expansion
Slide 41: Across All Verticals
Across All Verticals Trusted by the World’s Leading Brands
Slide 42: GTM Customer Engagement
Discover New GTM Optimize Opportunities Use Case(s) Drive new use Customer Deploy Drive Adoption Expand existing Expand into broader cases throughout the organization Agreement Cloud Engagement Typically start with initial eSignature eSignature volumes & use case(s) (CLM, Analytics) use case(s) Expa
Slide 43: Partner
Direct Land | Expand | Extend Digital Lead | Try | Buy | Upgrade Partner Reseller | Software Vendor | Systems Integrator Hundreds of Millions Signers
Slide 44: Robust Partner Delivery Model
Resellers Robust Partner Software Vendors Delivery Model Systems Integrators
Slide 45: Investing in International Growth
Investing in Digital - 180+ Countries International Direct - Focus 8 Growth Market Prioritization & Investment Tier 1: Market Leader Tier 2: Seed and Grow Tier 3: Digital & Emerging Primary market focus for Direct GTM investment High potential investment countries Digital First Strategy Fully locali
Slide 46: Engaging with Customers Wherever They Are
Engaging with Customers Wherever They Are Try Buy Signing Customer Digital Digital and Partner Trials Direct Journey Partner Sales Grow Digital Direct + Partner Success Expand / Extend
Slide 47: Multi-Channel Experience throughout the Customer Journey
Multi-Channel Experience throughout the Customer Journey Extend Accelerate our customers’ path to the Agreement Cloud Expand From eSignature to Agreement Cloud Direct Partner integrations customer Digital From single GROW customer department to ELA From digital Signers to direct Across all GTM teams
Slide 48: Path to $5B
Local empowerment & talent at scale Workforce diversity & culture inclusion Enabling the ecosystem Strategic Investments Accelerating our growth and scale Market expansion & Customer Platform acquisition adoption & growth orientation Digital first strategy Customer success expansion Multi-product se
Slide 49: Scaling to $5B+
Scaling to $5B+ Cynthia Gaylor Chief Financial Officer 1 2 3 4 5 6 7 8
Slide 50: Four themes of growth at scale
One Two Three Four Foundation for Robust Recurring Multi-Vector Strategic Operating Growth at Scale Business Model Diversified Growth Leverage
Slide 51: Four themes of growth at scale
One Two Three Four Foundation for Robust Recurring Multi-Vector Strategic Operating Growth at Scale Business Model Diversified Growth Leverage
Slide 52: Year of Firsts
1 Year of Firsts … $1.5B $1.7B $287M 892K Revenue Billings Int’l Revenue Total Customers 41% CAGR F18-211 42% CAGR F18-211 47% CAGR F18-F211 34% CAGR F18-F211 12% 15% 123% 125K Operating Margin2 Free Cash Flow Margin2 Net Dollar Retention Direct Customers F21 F21 F21 43% CAGR F18-F211 (1) Unless oth
Slide 53: Market Leader with Massive and Expanding TAM
Market Leader with Massive and Expanding TAM Prepare Sign Act World’s #1 eSignature Manage ~$50B+ $25B 1 ~$25B 1 TAM 1 = (1) DocuSign estimate combining commissioned third-party research with internal customer count, pricing and spending data.
Slide 54: 17 Years to $1B, <1 Year to $1.5B
17 Years to $1B <1 Year to $1.5B 54% Revenue 8yr CAGR1 Total Revenue Billings (1) Fiscal years ended January 31, 2013-2021.
Slide 55: Scaling to the next billion and beyond
Scaling to the next billion and beyond Constant Multiple Customer Success Scaling Innovation Expansion and Partner Platform and Vectors Ecosystem Operations
Slide 56: Four themes of growth at scale
One Two Three Four Foundation for Robust Recurring Multi-Vector Strategic Operating Growth at Scale Business Model Diversified Growth Leverage
Slide 57: Capacity-based subscription model winning
123% Dollar Net Retention1,2 Capacity-based 51% Total Customer subscription YoY Growth2 model winning 50% customers of Subscription Revenue YoY Growth2 all sizes • Recurring Revenue Model • Robust SaaS Growth (1) Compares the ACV for subscription contracts from a set of enterprise and commercial cus
Slide 58: Strong and Consistent Revenue Growth at Scale
Strong and Consistent Revenue Growth at Scale Anywhere Economy Accelerating Growth in Recent Quarters Total Revenue1 Subscription Revenue1 Revenue Contribution2 YoY Growth YoY Growth (1) Fiscal years ended January 31. $ in millions. (2) Fiscal year ended January 31, 2021.
Slide 59: Billings Visibility
Billings Visibility Pre-COVID1 Rolling 4-Qtr Rolling 4-Qtr Billings Growth Revenue Growth 32%–38% 35%–39% (Pre-COVID)1 (Pre-COVID)1 45%–56% 39%–49% (During COVID)2 (During COVID)2 During COVID2 Rolling 4-quarter average Revenue Rolling 4-Qtr YoY most relevant metric Billings YoY (1) Fiscal years end
Slide 60: Four themes of growth at scale
One Two Three Four Foundation for Robust Recurring Multi-Vector Strategic Operating Growth at Scale Business Model Diversified Growth Leverage
Slide 61: Large and Growing Customer Base
Large and Growing Customer Base TOTAL 892K customers 42% 8yr CAGR1 DIGITAL 767K customers 41% 8yr CAGR1 12% Revenue contribution (F21)2 DIRECT 125K customers 54% 8yr CAGR1 88% Revenue contribution (F21)2 >$300K ACV 599 customers 45% 8yr CAGR1 (1) Fiscal years ended January 31, 2013-2021. (2) Fiscal
Slide 62: Diverse Customer Base Across Verticals
Diverse 15/15 5/10 Customer F500 Financial companies Public sector (US) Base Across 1 14/15 10/10 Verticals F500 Healthcare Private universities companies (US) >75% Fortune 500 13/15 10/10 Customers F500 Technology Public universities companies (US) (1) Data as of March 2021.
Slide 63: Rapid International Expansion
Rapid International Expansion EMEA 67% Int’l Revenue North America Growth (F21)1 LATAM APJ 20% of Total Revenue (F21)1 (1) Fiscal years ended January 31.
Slide 64: Expansion Across Customer Cohorts
Expansion Across FY21 Customer Cohorts FY20 FY19 FY18 FY17 FY16 FY15 FY14 FY13 Pre-FY13 (1) Fiscal years ended January 31.
Slide 65: 123% Net Dollar Retention
Strength in customer demand driving accelerated growth at scale 123% Net Dollar 1 Retention (1) Compares the ACV for subscription contracts from a set of enterprise and commercial customers at two period end dates. To calculate our dollar-based net retention rate at the end of a base year (e.g., Jan
Slide 66: Four themes of growth at scale
One Two Three Four Foundation for Robust Recurring Multi-Vector Strategic Operating Growth at Scale Business Model Diversified Growth Leverage
Slide 67: Demonstrating Operating Leverage
1 Demonstrating Operating Leverage Operating Margin Significant F21 revenue growth 49% +750bp improvement in F21 Op Margin Increased OPEX efficiency $47 $15 Driving towards long term target model Non-GAAP Operating Income (Loss) Margin % (1) Fiscal years ended January 31. $ in millions. Margins are
Slide 68: Sales & Marketing Productivity Gains
1 Sales & Marketing Productivity Gains Investment 50% Priorities Augment quota-carrying capacity Fuel global demand engine Execute digital strategy Operating 44% Leverage Increased productivity Optimizing land and expand motion Non-GAAP S&M Margin % (1) Fiscal years ended January 31. $ in millions.
Slide 69: Extending Research & Development Leadership
1 Extending Research & Development Leadership Investment 16% Priorities Grow eSignature leadership DAC available everywhere Invest in foundational innovation Scale ahead of consumption Operating Leverage Predictable release value Efficient shared services Non-GAAP R&D Margin % (1) Fiscal years ended
Slide 70: Driving Improved Cash Flow
Driving Improved Cash Flow Operating Cash Flow1 Free Cash Flow1 $372 or 26%2 Capex = 6% FY21 rev $290 or 20%2 Non-GAAP OCF Margin % Non-GAAP FCF Margin % (1) Fiscal years ended January 31. $ in millions. Margins are as % of revenue. Please see Appendix slides for non-GAAP reconciliation. (2) Adjuste
Slide 71: Strategic Capital Structure
Strategic Capital Structure Capital Efficient Model Strategically Investing Cash flow funding working capital Maintain eSig leadership position $867M in cash as of January 31st 2021 Expand Agreement Cloud capabilities Maximum Flexibility Strategic opportunities • Completed $690M convertible debt1 •
Slide 72: Long-Term Growth Model & Profitability Framework
Long-Term Growth Model & Profitability Framework Non-GAAP F18… F21 F22E Long-Term Gross Margin 79% 79% 79-81% 78-82% S&M 51% 44% 35-39% R&D 17% 14% 14-16% G&A 13% 9% 7-9% Operating Margin (2%) 12% 13-15% 20–25%
Slide 73: Financial Highlights
Expansive Addressable Market with Sizable Runway Financial Highlights Strong Revenue Growth at Scale – #1 Priority Subscription Model with Highly-Predictable Revenue Powerful Land and Expand Model Driving Multiple Opportunities Ongoing Operating Leverage Supporting Growth
Slide 74: Q&A
Q&A Annie Leschin VP of Investor Relations 1 2 3 4 5 6 7 8
Slide 75: Appendix
Appendix
Slide 76: GAAP to non-GAAP operating gain / (loss) and free cash flow reconciliation
GAAP to non-GAAP operating gain / (loss) and free cash flow reconciliation Adjusted Operating Gain / (Loss) (in $K) Twelve Months Ended January 31, 2021 2020 2019 2018 GAAP Operating Loss (173,855) (193,509) (426,323) (51,653) Add: Stock-based Compensation in Cost of Revenue 42,658 28,585 42,040 1,8
Slide 77: GAAP to non-GAAP operating expenses reconciliation
GAAP to non-GAAP operating expenses reconciliation Sales & Marketing (in $K) Twelve Months Ended January 31, 2021 2020 2019 2018 GAAP Sales & Marketing 798,625 591,379 539,606 277,930 Less: Stock-based Compensation in Sales & Marketing (131,041) (94,863) (172,115) (9,386) Less: Amortization of Acqui
Slide 78: Computation of billings
Computation of billings Computation of Billings (in $K) Twelve Months Ended January 31, 2021 2020 2019 2018 Revenue 1,453,047 973,971 700,969 518,504 Add: Contract Liabilities and Refund Liability, End of Period 800,940 522,201 390,887 282,943 Less: Contract Liabilities and Refund Liability, Beginni